Image via Famous Dave's

published on July 27, 2018 - 2:08 PM
Written by Edward Smith

Famous Dave’s is queuing up a new recipe for a concept kitchen that would increase its footprint without the demand of a full-size restaurant — and they’re considering Fresno for a test market.

Anand Gala, president and CEO of Gala Corporation, said the “virtual kitchen” would be a hub for take-out, delivery and catering, without a dining area. Gala is the franchisee for Famous Dave’s in California.

Though still in the research phase, the plan is to use third-party delivery services like Uber Eats, Grubhub and others to bring the Famous Dave’s menu to customers’ doors. The hope is to have pulled the trigger on a location in the next 18 months, Gala said.

“This is very exploratory, but we feel very passionate about it,” he said. “It’s possible that markets might not be able to sustain an entire Famous Dave’s, but a virtual kitchen might be able to penetrate into those questionable markets.”

Having a smaller footprint is an easier way to put a concept’s toes in the water. Based on the performance of Famous Dave’s in Fresno, officials feel they haven’t reached the capacity and potential of the market, Gala said.

The idea is still very new and it has a lot of kinks to work out, one being getting people to know just what it is for.”

“If it wasn’t going to be visible from the street it would take a large learning curve for people to understand your service,” said Nick Frechou, senior vice president for Retail California. “There is a large undertaking in education that you have going on. It would take a lot of marketing dollars.”

The rents for retail space on high-traffic corners are “extremely expensive” and very competitive, said Frechou.

Famous Dave’s isn’t alone in developing new concepts to deal with high rents.

Recently, Applebee’s pulled out of deals in Tulare, Los Banos and Selma due to the cost of operating a large restaurant space, Frechou said. There are even rumors that they are flirting with the idea of reducing their footprint to 3,000-4,000 square feet from their usual 5,000-6,000 square feet, he said.

“You’re seeing a lot of successful restaurants in the 2,000-3,000 square foot range,” Frechou said. Habit Burger and Blaze Pizza are just some of the restaurants making a lot of moves. Cafe Rio is also expanding.

Gala feels that this might be the next step in restaurant evolution. Take-out began about 15 years ago, he said, and since then, eateries have been dedicating entire portions of their space to meet that demand. Third-party delivery is a way to tap into the next generation of 18-35 year olds, which research has shown is the ideal customer base for on-demand ordering.

“I feel as though that is the case because they have grown up with technology and that is ubiquitous for them,” said Gala. “They adopt things a little faster and we are seeing that today.”

And in the Fresno market, third-party delivery has been increasing.

“Just in the year’s time we’ve been doing it, we’ve doubled our business,” said Robyn Richardson about Uber Eats sales. Richardson is owner of Patio Cafe in Fig Garden Village in Fresno.

For Richardson, third-party delivery services can act as an advertising vehicle for the restaurant. People see it available on the service applications and get to know the food.

“There are a lot of residual benefits,” Richardson said. “It’s hard to put a number on it, but you really feel it.”

Both Richardson and Gala feel the trend is heading in the direction of third-party delivery, but the question for all business owners is to how best take advantage of the growing market.

“We’ve seen the rise of third-party delivery as a way to use restaurants differently than 10 years ago,” said Gala. “Based on that, our responsibility is to be available for our customers.”

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